Prime Minister’s Employment Generation Program (PMEGP): Complete Guide, Eligibility, Subsidy Rates, and Application Process

The Prime Minister’s Employment Generation Program (PMEGP) is a subsidy scheme. It gives subsidies on loans to people taking loans to start a new business. It has been launched at the national level by Khadi and Village Industries Commission (KVIC). Under the PMEGP scheme, the maximum amount to be given to those starting a business in the manufacturing sector is Rs 25 lakh. And a maximum of Rs 10 lakh for those starting a business in business or service sector. Today in This article we’ll discuss the complete details about the PMEGP scheme.  You’ll find information such as how to apply, eligibility, subsidy rates and may more information so read till last.

Subsidy available under PMEGP area/location:

General Category	subsidy
Urban	15%
RURAL	25%

 

PMEGP scheme is also offered to those belonging to physically handicapped, SC/ST/OBC/minorities/women, ex-servicemen and border areas etc. The age of the applicant should be minimum 18 years. To avail this subsidy, the applicant must have passed 8th class.

 

For which type of industry loan is available?

Under the PMEGP loan scheme, loans are given to youth for selected industries. Which industries come under this scheme for which loans are given to the youth. The major industries among these are as follows:-

1. Agro-based industries
2. Food Industry
3. Chemical based industries
4. Industries related to engineering works
5. Forest based industries
6. Industries related to service sector
7. Industries related to non-conventional energy

Youth from urban and rural areas working in these industries can take advantage of this scheme.

Essential Qualifications for PMEGP Loan Scheme

Some qualifications related to youth have been set by the government for this scheme. They are as follows:-

1. First of all, the applicant youth should be a resident of India.
2. The second qualification is that the age of the youth should be at least 18 years or more.
3. The applicant must have passed 8th.
4. Youth are given loans under the PMEGP loan scheme to start a new business.
5. Under this scheme, loans are not given to expand the old business. Applicants should take special care of this.
6. In this scheme, priority will be given to those youth who have taken training related to their business from a government institution.
7. If the applicant has already availed or is availing the benefit of subsidy under any government scheme then he will not get the benefit under PMEGP Loan Scheme-2021. Such youth should not apply under this scheme.

 

How to apply online for the PMEGP scheme?

To apply online for PMEGP you can visit the website of Khadi and Village Industries Commission (KVIC) or click on the link given below to apply online. https://kviconline.gov.in/pmegpeportal/jsp/pmegponline.jsp When you click on this link, it will give you instructions for the application form to fill it in draft form and save it, take a printout and submit it to the concerned nearest offices. Advertisements will be submitted by State/Divisional Directors of KVIB through KVIB and Industry Directors of the respective States.

How to apply online for PMEGP scheme

Step 1 :  Fill the required information in the application form

Step  2:  After filling all the information, save the application as a draft

Step  3:  Take print out of the application form

Step  4:  Submit the printout of the application form at the nearest office

Step  5:  Complete all the formalities by the concerned bank

Required Documents for PMEGP scheme

• Project report
• Caste certificate
• Special category certificate
• Rural area certificate
• Certificate of Education/EDP/Skill Development Training

 

Know the status of your application in this way

Below we have listed steps on how you can check the status of you PMEGP loan application.

Step 1: First of all go to the official website of PMEGP or click on kviconline.gov.in/pmegp/

Step 2: Open a new page by clicking on the Login Form for Registered Applicants visible there.

Step 3:  After this, enter your ID and password and then log in.

Step 4: At last you will see the View Status button, if you click on it, the status of your application will be visible to you.

Some important information related to PMEGP loan scheme

Below we have listed some of the important information that you should consider while taking the PMEGP loan.

1. The loan interest rate in the PMEGP loan scheme is the normal rate applicable to the MME sector.
2. The initial tenure of a PMEGP loan generally does not exceed six months but later banks can extend the repayment period of loan given to the applicants under this scheme from 3 to seven years.
3. Margin money/subsidy is deposited in a separate savings account, which is linked to your loan account. It is fixed for three years. After that this amount is merged with the PMEGP loan amount.
4. The applicant gets more subsidy than the interest he has to pay on the loan.
5. There are some businesses which run for a long time and are able to earn profits after a long time. If you want to start this kind of business then you can avail the benefits by taking a loan under the PMEGP scheme.

 

Who gets how much subsidy?

Only 15 percent subsidy is given to the applicants of general category from urban areas. 25 percent subsidy is given to general category youth of rural areas. Youth belonging to the general category also have to contribute ten percent to the project. Applicants from reserved category SC-SWT, OBC category are given 25 percent subsidy for projects in urban areas and 25 percent subsidy for projects in rural areas. The amount of contribution of these candidates is only 5 percent of the cost of the project. There is a provision of giving subsidy of 25 percent of the scheme cost in urban areas and 35 percent of the scheme cost in rural areas to women, handicapped, ex-servicemen, residents of hill and border areas and youth living in NER etc., whereas all these categories For youth, personal contribution has to be given only 5 percent.

By applying online for the PMEGP scheme, consumers can avail benefits or subsidies. The beneficiary is only required to invest 5-10% of the project cost and on that cost the government provides a subsidy of 15-35% considering his/her eligibility. Being a credit linked subsidy scheme, the PMEGP Loan Scheme majorly promotes employment among the youth and helps in setting up small businesses to increase employment opportunities across the country.